Portage committee reviews costs to health insurance changes

2013-02-05T00:00:00Z Portage committee reviews costs to health insurance changesJoyce Russell joyce.russell@nwi.com, (219) 762-1397, ext. 2222 nwitimes.com

PORTAGE | The City Council's Budget Committee on Monday reviewed the costs of switching over employee health insurance programs prior to voting on several measures at tonight's regular Portage City Council meeting.

At question is the switching of 43 non-union, non-elected employees' health insurance. When open enrollment begins Feb. 11, those employees will have to choose from three new health insurance plans.

The city's administration has proposed giving those employees 3 percent pay increases. The measure was stalled at a special council meeting last week.

Clerk Treasurer Chris Stidham said the cost of those raises will be about $43,000 for the remainder of the year.

The City Council will also have to take action on contributions to health savings accounts for those employees who chose the high deductible health insurance plan and buyout measures for both vacation time and paid personal days.

Stidham said while the administration was hoping all employees would opt for the high deductible with an HSA option, it appears about 80 percent will choose that option. Those that choose that option will be given a one-time $1,200 contribution to their HSA account. That will cost the city $54,000, if all employees take it.

Stidham said the premiums for the other two insurance plans are significantly higher. Employees, no matter what plan, can receive incentives for not smoking and participating in a wellness program that could total $50 per month if they did both. He estimated those incentives will cost $17,500 if everyone participates in both programs.

Employees opting for the high deductible plan will also have the option of selling back a week's vacation and personal days at a total cost of $88,000 to the city. That money would be placed in their HSA account.

Stidham said the city will see new revenues, totaling about $165,000, from increased premiums, future building fee hikes and a proposed reimbursement from the Utility Department to the city for stormwater work. He said their will also be savings on claims and additional savings in other areas to help compensate for the increased expenditures.

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